The islanders of Foula have never been known for their desire for change. More than 250 years after the rest of the Western world adopted the Gregorian calendar, the remote community still uses the Julian calendar established by Caesar in 45BC - celebrating New Year 12 days late.

But today as the residents of the tiny Shetland outpost mark the start of 2008 there is hope that this year will bring them closer to the 21st century.

Residents claim they have relied for 'far too long' on temperamental ageing diesel generators. Now a project which began eight years ago is almost ready to supply the islanders with renewable electricity. In little more than a generation, the community, which used to have a population of hundreds in the 19th century, will have gone from oil lamps and peat fires to all the conveniences of modern life.

'The price of diesel is horrendous, it's costing the Foula folk 14p a unit which is the most expensive electricity in the country,' said Frank Robertson, a trustee of the Foula Electricity Trust.

'We've had severe storms here and they were just on the point of running out of diesel which would have plunged them into darkness. Being totally dependent on diesel just won't do. Our objective is to run everything on renewables and have the diesel as a fall-back.'

Last year the island installed an array of solar panels as a step towards their dream of self-sufficiency, but the shorter days mean they are now reliant on two 25kW diesel generators until the planned completion of a hydro scheme later this year.

In an effort to preserve their ageing machines they only run one at a time so the total power to the island is a mere 25kW, limiting the amount of power available to each household.

The islanders are looking towards a future mix of solar, hydro and wind power to provide for their energy needs. Contractors are installing a small hydro generator which will be fed from a loch up a high hill.

Over the next few weeks another pipe line will be laid up one of the highest hills in Shetland for a second, more powerful, generator.

'We'll be turning out something like 20 kilowatts of water power which would provide electricity when the lochs are full from October until April,' Robertson said. 'During the summer we can't expect any water out of the lochs. Hydro would be the winter energy supply with wind and solar for the summer.'

Five small modern wind turbines will be installed each turning out around 6.5kW. When it is finished it is hoped the renewables will provide around 50kW of power, double the present amount.

'The whole project should cost around £800,000 and we got most of that from grants of some form or other from the lottery and other organisations that support us,' Robertson said.

· This article was amended on January 20 2008. We described the island of Foula as 'a tiny Hebridean outpost', but it's a Shetland isle. This has been corrected.